Budget 2017: Push for BHIM app, railway e-tickets

New Delhi, Feb. 1 -- Just a month after the launch of the Unified Payments Interface (UPI) based Bharat Interface for Money (BHIM) app, finance minister Arun Jaitley announced more steps to strengthen the digital payments ecosystem and two more schemes to incentivise users of the BHIM platform.
The minister said that the BHIM app will unleash the power of mobile phones for digital payments and financial inclusion. As many as 12.5 million people have downloaded the BHIM app so far. "The government will launch two new schemes to promote the usage of BHIM; these are, a referral bonus scheme for individuals and a cashback scheme for merchants," the minister said in his Budget speech for financial year (FY) 2017-18.
The details of the schemes announced were not available immediately. A referral bonus scheme for individuals means that if you refer anyone on BHIM, you are likely to get an incentive-like schemes that some e-commerce companies offer to their customers for referring friends.
This app allows you to send and receive money over the Unified Payments Interface (UPI) platform. UPI allows customers with bank accounts to send money, like they would a text message. As UPI runs on the Immediate Payment Service (IMPS) platform, the transaction is instant. To use the BHIM app, you need to have a bank account with a UPI member bank, a registered mobile number, internet access and an Android smartphone. To use the app, you need to download it from the Google Play store. Remember that you can use this facility only if you are a customer of a UPI member bank. You can create your virtual payment address (VPA) on the app-name@upi.
Besides sending and receiving money using VPA, you can also scan a QR code and pay. There are no charges for making payments through the BHIM app. But your bank may levy a nominal charge: as UPI or IMPS transfer fee. All payments through UPI go directly to a bank account.
The government also plans to take steps to promote and possibly mandate petrol pumps, fertilizer depots, municipalities, block offices, road transport offices, universities, colleges, hospitals and other institutions to have facilities for digital payments, including from the BHIM app.
According to data released by the Reserve Bank of India (RBI), UPI transactions between 1 January and 30 January doubled from over 2 million in December to over 4 million. The volume of transactions also more than doubled, from Rs700 crore to Rs1,590 crore. The UPI-based BHIM app was launched on 30 December.
The government has also scrapped service charges levied on e-tickets by the Indian Railway Catering and Tourism Corporation (IRCTC), a public sector company under the Ministry of Railways. IRCTC currently levies a service charge on each ticket booked. It levies a service charge of Rs20 (plus service tax) per ticket for second class and sleeper tickets, and Rs40 in case of all other classes for e-tickets. A maximum of six passengers can be booked on a single ticket. Cashless reservations have gone up from 58% to 68%, the finance minister said. IRCTC books over 1 million tickets each day.
However, the service charge will continue to be applicable on the i-tickets booked through IRCTC. For this category of tickets, the service charge is Rs80 for second class and sleeper tickets, and Rs120 for all other upper classes. The finance minister also said that digital payment infrastructure and grievance handling mechanisms in the country shall be strengthened.